GOVERNOR KAINE ANNOUNCES RESULTS OF 2009 DISPARITY STUDY
- Findings show significant improvements in state hiring of women- and minority-owned firms following Governor's Executive Order

FROM THE OFFICE OF THE GOVERNOR

January 15, 2010

Contact: Gordon Hickey
Phone: (804) 225-4260
Cell Phone: (804) 291-8977
Internet: www.governor.virginia.gov

RICHMOND - Governor Timothy M. Kaine today highlighted the results of the 2009 Disparity Study for the Commonwealth of Virginia, which showed substantial improvements in state contracting of women- and minority-owned firms in the last five years. Since 2006, the number of women- and minority-owned prime firms used by the Commonwealth, public colleges and universities, and within the private marketplace in Virginia has more than doubled. During the same time period, overall spending grew by more than $315 million.

"Shortly after I took office I ordered all state agencies to develop gender-neutral and race-neutral procurement policies to maximize the participation of all our citizens in the vast array of commercial opportunities offered by the state," said Governor Kaine. "While we have more work to do to improve the Commonwealth's historically abysmal record in buying goods and services from small, women-, and minority-owned firms, I'm pleased by the progress we've made in the last several years. I am confident we will build on our successes in the future."

The report was undertaken as a requirement of Executive Order 33 issued in 2006 to ensure enhanced opportunities for small, women-, and minority-owned businesses in the Commonwealth. The 2009 Commonwealth Disparity Study revealed substantial growth in spending with women- and minority-owned businesses at both the prime contractor and subcontractor levels. Overall prime spending by the Commonwealth and major state colleges and universities with women and minority prime vendors over five years grew from $107.7 million (1.2 percent of Commonwealth prime spending) in 2004 to $423.1 million (3.2 percent of Commonwealth prime spending) in the 2009 study.

Other key findings include:

o Stronger growth in a number of procurement areas. In the category of other services, spending with women- and minority-owned firms went from $37.2 million over five years (2.1 percent of the total) to $141.8 million over five years (6.3 percent of the total). Similarly, construction subcontracting with women- and minority-owned firms went from less than $1 million (about 1 percent of the total) to over $23.2 million (over 14.3 percent of the total).

o Substantial disparities between the percentage utilization of women- and minority-owned firms and their business availability. The 2009 study provided a number of possible improvements to the Commonwealth SWaM program and inclusive purchasing best practices for the Commonwealth to consider.

o Substantial barriers in access to private market opportunities. The 2009 study presented data showing women and minorities receiving less than half a percent of subcontracts in private sector commercial construction, a much lower percentage than what was achieved through the Small Woman and Minority (SWaM) program. The 2009 study also found marketplace disparities persist.

Conducted by Florida-based consulting firm MGT of America, Inc., the study examined the contracting practices of executive branch entities and institutions with procurement responsibilities-including the Virginia Information Technologies Agency, Virginia Department of General Services, Virginia Department of Transportation, and universities operating under management agreements. The 2009 report shows significant improvement in contracting with women and minority vendors since a previous study conducted in 2004 under the Warner Administration, and in comparison to the private sector. The 2009 study also noted better data tracking by the Commonwealth and a strong growth in the number of certified firms.

Governor Kaine has directed the Department of Minority Business Enterprise to more forward with Phase II of the Disparity Study. Phase II will add qualitative and anecdotal evidence to the statistical data provided in Phase I. Phase II will also include personal interviews, focus groups, public hearings and a telephone survey.

Governor Kaine also has directed Executive Branch entities and institutions with procurement authority to further strengthen their procurement guidelines to reflect the Commonwealth's intent to increase the percentage of contracts awarded to women and minority firms.

To read the entire report go to http://www.dmbe.virginia.gov/pdf/Disparity_Study_January_13_2010.pdf.

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